Earnings

Fitbit shares plunge 15% on guidance despite beat

Fitbit dives on weak Q1 guidance
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Fitbit dives on weak Q1 guidance

Fitbit reported earnings and revenue on Monday that easily topped analysts' expectations, but its shares plunged after weaker-than-expected guidance for the current quarter.

The wearable fitness device maker posted fourth-quarter earnings of 35 cents per share, adjusted, on $712 million in revenue. Earnings rose from 21 cents per share a year earlier, while sales climbed from $370 million.

Wall Street expected Fitbit to post earnings of 25 cents per share on $648 million in revenue, according to a consensus estimate from Thomson Reuters.

Fitbit signs and traders at the NYSE during their IPO, June 18, 2015.
Source: CNBC

However, its shares fell 15 percent in after-hours trading. Fitbit said it projected first-quarter adjusted earnings per share of between zero and 2 cents. Wall Street, meanwhile, had expected earnings of about 23 cents per share in the quarter, according to StreetAccount.

The company said it projected revenue of between $420 million and $440 million in the quarter. Analysts had on average expected $483.8 million, according to StreetAccount.

However its full-year 2016 earnings guidance of between $1.08 and $1.20 per share and sales of $2.4 billion to $2.5 billion came in largely in line with expectations, according to StreetAccount.

Shares of Fitbit have plunged more than 40 percent this year amid concerns about increasing competition. The company's stock in the regular session Monday traded near $16 per share, well below the $20 per share price from its initial public offering last year.

Fitbit said it sold 8.2 million devices in the fourth quarter, up from 5.3 million in the prior-year quarter. Its unit sales nearly doubled for the full year to 21.4 million.

The company said the global launch of two new products would hit its bottom line in the current quarter. It expects to see "higher sales and marketing expenses" as it rolls out Alta, a fashion-focused product, and Blaze, a smartwatch.

FItbit also expects "additional manufacturing costs" for the products. It said the timing of shipments for the devices could lead to "the majority of reorders" coming in the second quarter.

— CNBC's Everett Rosenfeld contributed to this report.